Suggestions on Possible Sleep Rebalancing so monsters can inflict it.
Sleep is a status condition that was originally going to be added to enemys but was then removed, and the only thing now that inflicts sleep is the sleep vials. For those of you who don't know what sleep does, sleep is a status condition that causes knight's or monsters that are afflicted to it to go to sleep, making them unable to move, but making them gain hp at a slow rate. Upon taking damage, monsters and or players will wake up, clearing them of the sleep condition.
Sleep was shot down as a monster effect because it was found to be overwhelming powerful against players, because it would root them and allow them to be swarmed and attacked. Sleep, unliked freeze, would not allow you to sheild, and thus you would be forced to take a hit, and the hp regen would not make up for it.
I personally believe that sleep requires some changes and it should be brought back into the game, in both clockworks and maybe a danger mission too. I believe that we can still have sleep, well, put you to sleep, without making it super devestating as it was before.
Here are the changes that I suggest:
--While a knight is under the effect of sleep, any damage taken will be reduced to 1/4 of the orginal damage.
--Upon being hit with sleep, a knight has 2 seconds of drowsiness before they actually fall asleep, allowing them time to escape.
--Attacks made to a sleeping knight knock the now awake knight back more then usual, allow for a better get-away. Think of it as a startling wake up!
--Knights can be woken up by other players if they are alerted to consciousness by having a bullet, sword strike, or bomb aoe touch them or come near them. Knights who are woken up this way. Note that the bomb aoe has to be set off near them, it can't be a lingering bomb effect near them. They can still be waken up due to a monster attack like normal!
--Remedy capsules, as a form of making sure sleep is still a effect that players will fear, cannot cure sleep. How do you take a pill if your asleep?
--Knights gain well-rested upon waking up, which prevents them from sleeping again for 2 seconds. This way, sleep monsters can still have aoe's without being super-overpowered and constantly making players sleep.
Does this nerf sleep into the ground? No. If nearby enemy's swarm a sleeping player, the player will still not be able to get away. 1/4 damage reduction may seem like a lot, but its basically another free hit on you, aka increasing enemy damage by 25%, and who knows where they could put you.
Tell me what you think. I would love to hear opinions on this. I'm willing to make changes. ^^
Edited: Thanks for the suggestion! I actually liked your idea a lot, and decided to revise.

I like it all, I do. But there are some issues:
1: you shouldn't be healed. You could be get HP this way by letting yourself go to sleep and then have a party member distract the monster that put you to sleep. The worst case was the Sloombargo, (Giant sloom. Look it up on the wiki) which could leave sleep dust, would be killed and then every knight would rush into the haze. They would all take a nap this way and usually regain a large block of HP.
2: You COULD cure sleep. If you took the pill during the drowsiness stage, you would be cured. You didn't mention this.
3: Hmm, how do you explain the defense buff? It's decent balance, but how do you explain it story wise? Also, maybe it is a little too much. How reducing it to about 3/8 or even 1/2 of the normal hit damage?
Otherwise, I do really wish sleep would come back. I'm not sure why, I just would.

I tried to make people like sleep again too. Didn't have much of a effect, but I still hope they put it in again for the sake of new armor, weapons & monsters and the katnip trinkets...
Good, but complicated.
1. Knights and enemies are already healed when put to sleep. If you add no KO, sleep becomes completely harmless.
2. Most people fear being hit a lot without waking up. Knights should wake up from any hit, both from players and enemies like freeze.
3. I don't really like temporary immunity. Instead, how about this: Add a 2 sec delay between being inflicted and the effect of sleep. In other words, after being hit by sleep, knights ill have two seconds to run away and find a safe place to sleep.